What You Need to Know Before Renting a Home

Finding the perfect living space can be one of life's most exciting journeys. When you're getting ready to begin the rental process it's important to make sure all your bases are covered. Failure to perform your due diligence could cause you to miss out on a property that's ideal for your needs — or saddle you with unfavorable lease terms.

To help ensure that you navigate the process successfully, let's review some tips for today's renters.

Know Your Rights

Landlords are like anything else in life; some are better than others. This means that it's important for tenants to fully understand their rights. Because these rights can vary by jurisdiction, checking online for the tenants' rights handbook published by your individual state or visit the U.S. Housing and Urban Development web portal.

Be Willing to Negotiate

People don't bat an eye when it comes to negotiating the purchase terms of a house. Negotiating things such as sale price and repairs are part of the protocol. When renting, however, many people fail to angle for a better deal. This is a mistake, a smart negotiator can secure better lease terms, an option to renew at a locked-in rate, or property improvements.

By negotiating a better deal, you can help protect yourself financially and maintain flexibility down the road.

Come Prepared

While it doesn't compare to the paperwork associated with a mortgage, the rental process does require some legwork. Typically, you'll need proof of income, references, a credit report and other documents.

Being prepared upfront allows you to act quickly when you locate a property that suits your needs.

Thoroughly Review Your Lease

Reading multi-page legal agreements isn't much fun; however, it's extremely important. If you fail to read your lease in detail, you may miss provisions that could have negative implications down the road. This could include limits on the number of guests, unreasonable fees or wait times for repairs, restrictions on modifying the property and more.

By reading your lease line by line and asking for clarification as necessary, you can help ensure that you reach a rental agreement that works for both sides.

Protect Yourself from Financial Penalties

It's common practice for landlords to ask for a one month security deposit to be returned at the end of the lease. Any damage or clean-up costs associated with the property may be deducted from that deposit when your lease is up.

To ensure that everything is fair and equitable, make a list of the condition of every room in the property, noting any flaws you see. You may also wish to videotape the property, so you have evidence that any damage was pre-existing.

Find the Appropriate Renter's Insurance

When you rent a home, the landlord's insurance only covers the structure itself and any items owned by the landlord inside the building. Your property, on the other hand, is not covered. A fire or a powerful storm could damage much of your property, leaving you without any compensation for your loss.

This is why renter's insurance is a good idea and may even be a requirement depending on where you live. It protects your assets, and it may also provide liability coverage if someone is injured in your home. You can sometimes receive a discount on renter's insurance if you have other types of coverage through one carrier. Talk to an insurance agent to find out what type coverage is best for you.

The Takeaway

Finding the perfect home can be an exciting experience. It's important, however, to protect yourself during every step of the rental process.

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